From top partners to regional adjustments, discover the significant changes in the world of EU FDI in 2022 and how they shed light on the future direction of markets

Foreign direct investment (FDI) plays a crucial role in the EU economy, and assessing its evolution over the past year brings interesting insights. Despite a slight decline in net investment stocks, detailed analysis of key partners and regional trends reveals significant nuances.

Slightly declining net stocks

In 2022, EU net investment stocks in the rest of the world fell by 1.4% to €9.382 billion. This trend was also reflected in investment stocks held by the rest of the world in the EU, which saw a decrease of 1.5% to €7.715 billion. However, the EU's net investment position vis-à-vis the rest of the world remained relatively stable, recording a decrease of only 0.8% compared to 2021, according to Eurostat data.

Significant role of Special Purpose Entities (SPEs)

Special Purpose Entities (SPEs) continue to play a significant role in FDI. At the end of 2022, they accounted for 31% of total EU FDI stocks abroad and 36% of FDI stocks held by the rest of the world in the EU. Although this share remained relatively stable compared to five years ago, in 2017, SPEs accounted for 53% of total EU FDI stocks abroad and 64% of FDI stocks held by the rest of the world in the EU.

Main partners: US and UK

At the end of 2022, the US absorbed 28% of the total FDI stocks held by the EU in the rest of the world (€2,656 billion), followed by the UK (€1,713 billion, 18%). It was ahead of Switzerland (€914 billion, 10%), Canada, Brazil, Singapore and China, all with a 3% share. In the opposite direction, US direct investors accounted for almost a third (€2,452 billion, 32%) of the total FDI stocks held by the rest of the world in the EU, followed by the UK (€1,403 billion, 18%).

Regional trends and policy adjustments

An analysis of investment trends in russia shows a 16% decrease in 2022, followed by an increase from 2021. In contrast, EU FDI stocks in Ukraine remained stable, while Ukrainian investment in the EU increased by 3%.